Welcome turnaround for Africa

It’s been a long, bumpy road for investors into Africa. In the three-year period to the end of December 2017, only five of the 22 Pan-African Equities funds in the HedgeNews Africa database were in positive territory. In 2017, however, there was a marked uptick in performance of these funds, which posted double-digit gains across the board, led by the Steyn Capital Africa Fund with a 66.01% return for the year.

In its Global Economic Prospects: Sub-Saharan Africa report, released on January 9, the World Bank said that, after the sharp downturn in 2016, growth in Sub-Saharan Africa was projected to rise from 2.4% last year to 3.2% in 2018. The bank cited firming commodity prices and strengthening domestic demand, but with risk tilted to the downside.

Of the 11 main Africa indices, ex South Africa, eight made gains in January with three posting declines.

Ghana’s GSE Composite Index led the gainers, surging 19.28% in January on the back of a 52.73% gain in 2017. With 7%-8% economic growth forecast, Ghana is expected to again be among the best-performing economies in the region, underpinned by higher oil and gas production and consolidation of macroeconomic stability.

The Nigeria All Share Index continued its winning streak in January, adding 15.95% for the month in the wake of a 42.3% rise last year. The World Bank expects growth in Nigeria to pick up from 1% in 2017 to 2.5% in 2018, “reflecting expectations that oil production will continue to recover and reforms in the foreign-exchange market, along with improved supply of electricity, will help lift growth in the non-oil sector”.

The Morocco All Share Index (MASI) gained 5.54% in January, adding to a 6.39% profit in 2017.

Namibia’s NSX Overall Index rose 4.5%, building on its 21.62% increase last year.

The SEMDEX in Mauritius gained 2.43% in January following a 21.77% rise in 2017.

Tunisia’s TUNINDEX added 2.38% in January having ended 14.45% ahead last year.

Kenya’s NSE 20 edged up 0.68% for the month on the back of 16.5% growth last year.

Egypt’s EGX30 Index added marginally to its 21.65% increase in 2017 to end the month 0.15% ahead.

Zimbabwe’s ZSE Industrial Index posted the biggest decline in January, plunging -8.31% to pare some of its 130.42% gains recorded in 2017.

Botswana’s Gaborone Index retreated -1.24% for the month in the wake of a -5.75% decline in 2017.

The Lusaka All Share Index shed -0.02% in January after posting a 26.97% rise last year. Copyright. HedgeNews Africa – February 2018.

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